“When you grow tired of Maryland taxes squeezing every dime out of your business, think Texas.”
If you live in Maryland, it’s possible you’ve heard those words recently on your television or radio in the pleasant drawl of Texas Gov. Rick Perry. In a new ad campaign aimed at local business owners, the unsuccessful 2012 Republican presidential candidate promotes the Lone Star State for its “limited government, low taxes, and a fair legal system.”
The radio ad is the more entertaining version, containing a brutal direct attack on Democratic Gov. Martin O’Malley. Think of it as an early salvo from one longshot presidential candidate to another.
“Unfortunately,” Perry says in the radio ad, “your governor has made Maryland the Tax and Fee State, where businesses and families are paying some of the highest taxes in America. Since taking office in 2007, he’s approved 40 new and increased taxes and fees, projected to cost you $9.5 billion more through 2014. That’s a job-killer.”
There’s a good reason these ads are running now in the Free State – it’s because Perry’s argument has already proven persuasive to business owners in so many other states with hostile business climates.
In 2011, when Perry emerged on the presidential scene, he brought with him poor debating skills and a great story about his state’s economy. At the time, quite a few political opponents and partisan writers set out to debunk the Texas miracle.
But it has proven hard to debunk because Texas has continued to outperform its peers so consistently. Believe it or not, all the people and businesses that have left other states for Texas over the last few years have had pretty good reasons.
Some of the Texas truthers argued in 2011 that Perry’s state was succeeding merely because of corporate welfare packages – which are, unfortunately, a fact of life in nearly every state.
Others argued that Texas has a superabundance of low-wage jobs, but the numbers don’t necessarily bear that out. As of July, according the Bureau of Labor Statistics, the average Texas private-sector worker, at $823 per week, made slightly more ($3.08 more, to be precise) than the average American working in the private sector.
It is true that Texas has a natural advantage over many U.S. states – its vast energy resources. This is probably overstated, given that firms like Apple and Samsung don’t go there for the oil.
Yet part of the reason for the Texas miracle has been the state’s willingness to let its citizens exploit those resources. It’s certainly fair to compare Texas with states that choose not to do so, such as California – or even Maryland, where O’Malley effectively placed a moratorium on natural gas drilling in 2011.
Since the national job market hit its bottom in February 2010, Maryland’s private-sector job growth has lagged behind the national average at just 6.4 percent. Texas saw job growth of 11.4 percent during the same period.
And while Marylanders make about $70 more per week than Texans as of July, that gap (much of it consumed by high Maryland taxes and living costs anyway) has narrowed by more than half in the last three and a half years.
Maryland’s private sector workers saw their wages fall slightly during that period, even as wages in Texas rose nearly 8 percent.
Is Perry trolling his fellow governor? Sure. Will there be awkward moments at the next National Governors’ Association conference? Absolutely.
But is Texas’ economic dynamism for real? Does it provide a stark contrast to stagnant Maryland? You bet your job it does.DAVID FREDDOSO, a Washington Examiner columnist, is the former Editorial Page Editor for the Examiner and the New York Times-bestselling author of "Spin Masters: How the Media Ignored the Real News and Helped Re-elect Barack Obama." He has also written two other books, "The Case Against Barack Obama" (2008) and "Gangster Government" (2011).
Courtesy Bureau of Labor Statistics